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approved, reduce that deficit to roughly $6,500,000.
How is that
to be met? Your Excellency has already signed orders increasing
by ten cents per gallon the duty on heavy oils to be used as fuel
for heavy oil road vehicles and imposing a duty of ten cents per
gallon on other hydrocarbon oils at present untaxed, which are
estimated to bring in $1,000,000 per annum, and an order further
increasing the duties on liquor which are estimated to bring in
$650,000 per annum. It is proposed to increase the Entertainments
Tax, to increase Estate Duty and impose a new tax on table waters,
and an order to that effect under the Public Revenue Protection
Ordinance has also been signed. There is no reason why the con-
sumers of sarsaparilla and lemonade should not in their degree
contribute with the brandy and whisky drinkers to the upkeep of
the Colony. The amended Entertainments tax should produce an addi-
tional $300,000 per annum, the table waters tax $300,000, and the
increased Estate Duty $600,000. Our prospective deficit is, there-
fore, reduced to roughly 3 million dollars, though I must emphasize
that all these calculations of revenue presuppose a continuation of
the prosperity of the Colony.
It appears to me that there remains one way only to moet
the remaining deficit which represents roughly the excess of war
expenditure over war revenue and that is by increasing the war
taxation.
Although the War Revenue Ordinance has secured consider--
ably more revenue than was anticipated it has failed to secure
enough to meet the revised war expenditure either in the current
year or in 1941-42. The simplest way, and I must confess the way
which first appealed to me, largely on account of its simplicity, is
to increase the standard rates possibly by one half from 10% to 15%,
but I am satisfied that, this would emphasize to an intolerable dog";
the inequities and imperfections of the present compromise taxes. I
have already stated that it was estimated that the four taxes would
bring in 6 million dollars per annum. The revised estimate is